Table of Contents - Previous - Next

Helping the Unemployed

Highlights

The Economic Action Plan is supporting Canadian workers who have lost their jobs or may face layoffs. The Government’s investment in Employment Insurance (EI) benefits is expected to rise by $5.5 billion this year. Actions taken to strengthen benefits to date include:

• Providing up to an additional $2,235 in EI benefits by increasing entitlements by up to 5 extra weeks and increasing the maximum benefit duration to 50 weeks.
• Extending work-sharing agreements by 14 weeks to a maximum of one year to avoid layoffs, protect jobs and keep more Canadians working.
• Providing EI benefits through the Career Transition Assistance initiative for up to two years for long-tenured workers to encourage their participation in longer-term training and to allow workers who invest all or some of their severance in training to access EI sooner.
• Extending the Wage Earner Protection Program to cover severance and termination pay owed to eligible workers impacted by their employers’ bankruptcy.

Actions are also being taken to enhance the availability of training, including:

• Funds for enhanced training, available to all Canadians who need it, are starting to flow. The funds provide more training under EI and more training to support the needs of individuals who do not qualify for EI training, such as self-employed Canadians or those returning to work after taking many years off to raise their families.
• $55 million to help young Canadians find summer jobs. In these tough economic times, our young people must find meaningful employment.
• Additional support for older workers in a larger number of affected communities through the Targeted Initiative for Older Workers.
• The $2,000 Apprenticeship Completion Grant will be available by early July for those who have completed their training this year.
• In keeping with the First Ministers’ commitment, governments are developing a national foreign credential recognition framework this year.
• One Aboriginal Skills and Employment Partnership initiative is already underway and four are ready to be launched.
• The Aboriginal Skills and Training Strategic Investment Fund will begin to provide support for projects beginning in September.

Maintaining Low Employment Insurance Premium Rates

• Freezing EI premium rates at $1.73 per $100 until 2010—their lowest level since 1982—will provide an additional $10.5-billion stimulus, saving businesses and employees money.

Losing a job can be one of the most traumatic events in a person’s life, affecting that person and his or her family. That’s why Canada’s Economic Action Plan includes $6.3 billion over two years to support workers affected by the global slowdown and creates opportunities for workers through skills development.

In addition, as unemployment has risen, more Canadians are accessing EI benefits. Total EI support is now expected to be $5.5 billion higher this year.

Table 2.5
Helping the Unemployed

	2009–10	2010–11	Total
	(millions of dollars)
Strengthening benefits for Canadian workers	950	950	1,900
Enhancing the availability of training	940	965	1,905
Maintaining low Employment Insurance premium rates	818	1,631	2,449
Total—Helping the Unemployed	2,708	3,546	6,254
Note: Totals may not add due to rounding.

Introduction

The global recession has clearly hurt the Canadian economy and has had a major impact on those Canadians who have lost or are worried about losing their jobs. Employment in Canada has fallen by over 360,000 or 2.1 per cent since the recession began in 2008—with job losses concentrated in the manufacturing and construction sectors. Nevertheless, Canada has fared much better than the U.S. Since the beginning of the U.S. recession in January 2008, job losses have been proportionally twice as large as in Canada, with a record of 6.0 million jobs lost or a 4.3-per-cent decline (Chart 2.6). While the unemployment rate rose to 8.4-per-cent in Canada in May, the Canadian unemployment rate remains significantly below that of the U.S., currently at 9.4 per cent, its highest level in more than 25 years.

The better performance of Canadian labour markets also reflects policy actions taken by this Government, starting with measures taken in the October 2007 Economic Statement. The Economic Statement introduced historic tax cuts to support economic growth just before the U.S. economy entered into recession.

As the global recession intensified in November 2008, G20 leaders agreed to take coordinated policy actions to restore global growth. Canada fulfilled its commitment two months later by releasing its Economic Action Plan. The Plan aims to support the recovery by preserving and creating jobs in the Canadian economy.

The EI program has responded rapidly to these changing labour market conditions as it is designed to do. The Variable Entrance Requirement automatically makes it easier to qualify and extends the duration of EI benefits as unemployment rises. This year, the Government will invest $5.5 billion more in EI benefits than last year.

This flexibility is providing Canadians in all regions affected by the economic downturn with increased access to EI benefits and longer benefit periods when required. Between October 2008 and June 2009, more than 85 per cent of Canadian workers had easier access to EI benefits and for longer periods of time.

In the hardest-hit regions in Ontario, British Columbia and Alberta, 20 of 27 regions have seen their eligibility requirements decrease by between 70 and 175 hours. In Ontario, 9 of the 17 regions saw major increases in their duration of benefits (11 to 14 weeks), while in British Columbia, 5 out of 6 regions saw significant increases in their duration of benefits (7 to 12 weeks). In Alberta, all 4 regions also saw significant increases in their duration of benefits (7 to 9 weeks).

Further, regular benefits paid in Ontario during the first four months of the year have increased 68 per cent over the same period of one year ago. Benefits paid have increased by 103 per cent in Alberta and by 85 per cent in British Columbia—showing the responsiveness of the program. This compares to an increase of 21 per cent in the rest of Canada.

Canadians Are Getting the Support They Need

The Government already provided over $60 million to ensure that EI benefits continue to be delivered quickly. More staff are available to process claims and more call centre agents are answering the questions of Canadians. Hours of operation in the EI call centres have been extended by two hours, and Saturday service has been introduced. The EI pages on the Service Canada website are now more user-friendly, and include information on all new measures.

The Government is joining with Ontario to create a Joint Rapid Response Action Plan to meet the needs of workers, employers and communities affected by mass layoffs. Rapid response teams ensure that all affected employees are aware of benefits and support measures that are available to them, and help streamline the application process.

Since January 1, 2009, approximately 77 per cent of Canadians submitting new claims received their first cheques within 28 days. Within the next three months, additional staff will be hired and trained to help more Canadians receive their first cheques as quickly and efficiently as possible. The Government is taking every step to ensure Canadians receive their EI benefits as quickly and effectively as possible.

Strengthening Benefits for Canadian Workers

The Economic Action Plan took quick and decisive action to support workers and families hardest hit by the global recession and resulting job losses. In doing so, it responded to an immediate challenge with a long-term strategy. Measures in the Plan will not only help Canadians through the current difficulties, they will also support them in developing the skills needed to take advantage of new opportunities once the economy recovers. This comprehensive approach is the cornerstone of the Canada Skills and Transition Strategy. The first element of the strategy focuses on providing significantly enhanced EI benefits.

Extra Five Weeks of EI Regular Benefits: Canadian workers are now able to receive up to an extra five weeks of EI regular benefits. As of May 24, 2009, more than 155,000 unemployed Canadian workers had received additional benefits. An extra five weeks of benefits represents up to an additional $2,235 in EI benefits for an unemployed worker, making it easier to support their family while looking for a new job.

Work-Sharing Flexibility: The innovative work-sharing program is helping to preserve jobs that otherwise might have been lost. It is providing support in record numbers to thousands of businesses and their employees by allowing them to continue working a reduced work week, while they receive EI benefits for the days they do not work. Since the Action Plan initiative took effect in February, the number of job-sharing agreements has risen significantly. The number of Canadians benefiting from work-sharing arrangements are up more than fourfold since January to about 120,000 in May.

 

Wage Earner Protection Program (WEPP): The WEPP’s extended benefits took effect on January 27, 2009. Eligible workers are now provided guaranteed and timely payment of wages, severance, and termination and vacation pay owed if their employer becomes bankrupt and does not pay. As of April 30, 2009, 3,264 applications have been made under the WEPP since the budget announcement, and $1.7 million has already been paid.

Support for Long-Tenured Workers: Many Canadians who have worked for years, paying into EI, but who have collected very little EI, are now losing their jobs, especially in the manufacturing and forestry industries. To ensure these workers have support to retrain for a new job, possibly in an entirely different industry, their EI benefits will be extended up to a maximum duration of two years while they participate in longer-term training through the Career Transition Assistance initiative. In addition, workers who use their severance package to pay for training will have earlier access to EI benefits. In total, these measures are expected to benefit an estimated 40,000 Canadians. These extended benefits will be available for long-tenured workers beginning in the summer of 2009. Those unemployed Canadians who may benefit from these measures are being notified by Service Canada.

Enhancing the Availability of Training

Investing in training is one of the very best measures to ensure Canadian workers can get jobs. When Canadians lose their jobs, the Government wants to help them get back into the workforce as soon as possible. Over the long run, the Government wants to ensure that Canadians are ready for the economy of the future.

The Government funds a wide range of training benefits and other labour market supports to help Canadians prepare for and find new employment, whether they are eligible for EI or not. This assistance includes skills development and training, self-employment assistance, targeted wage subsidies, counselling, and job search assistance. Canada’s Economic Action Plan strengthened these objectives by providing additional resources focusing on retraining people so they have the skills they need to get good jobs in the growth industries of the 21st century, such as information and communications technology, biotechnology, energy and environmental technology. To help those workers hardest hit by the economic downturn, the Action Plan is investing over $1.5 billion in provincial and territorial programs. About 150,000 workers across the country will benefit from training.

This is good news for the laid-off auto worker in Oshawa who started looking for a job and needs new skills after 20 years on the assembly line. It is good news for the 45-year-old forestry worker in New Brunswick who lost his job when the sawmill closed down. It is good news for the young woman graduating from high school in Montréal who hopes for a career in Web design, but cannot afford the tuition. And it is good news for the single mother in British Columbia who wants to get back into the workforce and support her family by learning a trade.

The Labour Market Agreements and Labour Market Development Agreements give the provinces and territories the flexibility to address their particular circumstances. The provinces and territories can decide how to invest this federal support, such as: supporting transition for workers, creating opportunities for employment, helping communities gain self-reliance, or supporting skills training, including workplace-based training. These agreements will help workers cope with the challenges.

Enhanced EI Training Programs: For workers within the EI program, there will be more training opportunities provided to help them develop new skills and return to work. Agreements to deliver this additional training have now been signed with nine provinces and funds are starting to flow. Agreements with the remaining province and the territories are expected in the near future.

With all provinces and territories participating, the additional funding is expected to provide help for up to 100,000 more EI clients over the next two years.

Strategic Training and Transition Fund: Working cooperatively and with shared objectives, the Government already provides direct funding to provinces and territories to deliver skills and employment training tailored to the needs of their residents who do not qualify for EI. These programs include literacy and basic skills upgrading, wage subsidies and earnings supplements, skills enhancement and training, on-the-job training and workplace-based skills upgrading, and employment counselling. Examples of current programs that federal funding is supporting include Ontario’s Second Career Strategy, British Columbia’s SkillsPlus, Quebec’s Pacte pour l’emploi, and New Brunswick’s Workforce Expansion Program.

The Economic Action Plan provides even more support for the training and employment needs of those individuals not covered by EI. Funding agreements have now been signed with nine provinces, and money is starting to flow. Provinces and territories will report quarterly on the number of Canadians helped and the activities that were supported with the funding. Agreements with the remaining province and the territories are expected in the near future.

With all provinces and territories participating, the additional funding is expected to benefit 50,000 more people over the next two years.

Supporting Youth: Young Canadians are particularly affected by rising unemployment. The Action Plan provides additional funding for the Canada Summer Jobs Program so that more employers in the not-for-profit sector can hire summer students. These jobs will provide students with valuable work experience, while also helping them earn money to pay for their education. With the additional funding, the Canada Summer Jobs Program is expected to support the creation of more than 39,000 jobs for students.

In addition, agreements are being finalized with the YMCA and YWCA to implement the new YMCA and YWCA Grant, which will support the creation of internships for Canadian youth in not-for-profit and community services organizations, with a focus on environmental projects.

Targeted Initiative for Older Workers (TIOW): Older workers in a larger number of affected communities are being provided with additional support through the TIOW. The TIOW is a federal-provincial-territorial employment program that helps older workers in vulnerable communities by providing a range of employment activities tailored to their specific needs to help them remain active in the labour force. These activities can include prior learning assessment, skills upgrading, and experience in new fields of work. Under the Action Plan, the scope of the TIOW has also been expanded to include vulnerable cities with populations of less than 250,000. Arrangements are in place with Quebec, Nova Scotia, Saskatchewan, Yukon, Northwest Territories, Prince Edward Island, New Brunswick, British Columbia and Newfoundland and Labrador. Agreements are being finalized with Ontario, Manitoba and Nunavut.

$2,000 Apprenticeship Completion Grant: Changing demographics mean that the current shortages of skilled labour in certain parts of the country are expected to continue and expand once the economy begins recovering. The Apprenticeship Completion Grant provides an additional incentive for young Canadians to finish their training and launch rewarding careers in the skilled trades. The $2,000 Apprenticeship Completion Grant will be available by early July for those who have completed their training in 2009. An estimated 20,000 apprentices are expected to take advantage of the grant this year.

Foreign Credential Recognition: Achieving Canada’s economic potential requires that immigrants and newcomers to Canada have the opportunity to use their skills to the fullest. Many newcomers, however, have difficulty finding work that best suits their education and qualifications—in part because their qualifications are not always recognized in Canada. To help solve this problem, the Government is working this year with provinces and territories to develop a common framework to recognize foreign credentials.

Aboriginal Skills and Employment Partnerships (ASEP): ASEP fosters partnerships with provincial and territorial governments, Aboriginal organizations and the private sector to help Aboriginal Canadians receive valuable skills and employment training. Five new ASEP projects have been identified. These projects will commence in the summer of 2009 (see box). A call for new proposals was launched in April. These applications will be assessed and approved in the fall.

Aboriginal Skills and Training Strategic Investment Fund: This fund supports short-term, focused initiatives designed to help Aboriginal Canadians receive the specific training they require to benefit from employment opportunities, including those generated by the stimulus package. The application process for the fund was launched on May 4, 2009, and proposals are now being received from Aboriginal groups. There are three types of projects: training-to-employment projects, short-term skills development projects, and service improvement projects. Projects that meet eligibility criteria will be announced beginning in September.

Maintaining Low Employment Insurance Premium Rates

The EI program provides needed support to those who have lost their jobs. During harder economic times, EI pays more benefits to more people, increasing the cost of the program. Under normal circumstances, this would result in higher premium rates at a great cost to Canadians.

To leave more money in the hands of employers and employees, the Government has frozen EI premium rates for 2010 at $1.73, the same rate as 2009, and the lowest rate since 1982. This represents a projected relief of $10.5 billion over 2009 and 2010 for Canadian workers and their employers.

 

Table 2.6
Helping the Unemployed

	2009–10 Stimulus Value (millions of dollars)	Authorities in Place	Funding Committed (millions of dollars)	Funding to Flow/ Benefits Available
Strengthening Benefits for Canadian Workers
An extra five weeks of EI benefits	575	Yes	575	April
EI—long-tenured workers	250	Yes	250	June
EI—work-sharing	100	Yes	100	March
Wage Earner Protection Program	25	Yes	25	March
Enhancing the Availability of Training
EI training programs	500	Yes	484	June
Strategic Training and Transition Fund	250	Yes	238	June
Canada Summer Jobs Program	10	Yes	10	June
Federal public service  student employment program	10	Yes	10	May
YMCA-YWCA	15	Yes	–	June
Targeted Initiative for Older Workers	20	Yes	–	June
Apprenticeship Completion Grant	40	Yes	40	July
Foreign Credential Recognition program	25	Yes	–	September
Aboriginal Skills and Employment Partnership	20	Yes	3	June
Aboriginal Skills and Training Strategic  Investment Fund	25	Yes	–	August
Aboriginal Human Resources  Development Strategy	25	Yes	25	June/July
Keeping Employment  Insurance rates frozen for 2010	818	Yes	818	January 2010
Total	2,708		2,578

Table of Contents - Previous - Next